Goodyear shares tumble

Reaction to disclosure on financial restatements

By

AugustCole

SAN FRANCISCO (CBS.MW) -- Goodyear Tire & Rubber shares fell almost 10 percent Thursday after the world's biggest tiremaker disclosed it overstated earnings for the past 5 1/2 years by as much as $100 million.

Goodyear
GT, -1.51%
said it believes the error stems from mistakes in billing and accounting software systems at its North America operations. Its stock fell 58 cents to $6.24 on heavier than usual volume.

Standard & Poor's left its credit rating and outlook alone on Goodyear. "Standard & Poor's believes the restatements will not materially weaken the company's liquidity position or reduce access to its bank credit facilities," the credit agency wrote.

The Akron, Ohio-based company will also delay its third-quarter report, expected Thursday. The results will be released in mid-November along with other financial reporting related to the restatement.

The company said its net loss for the quarter will range from $90 million to $115 million, or 51 cents to 66 cents a share. Those figures include $56 million for European and North American restructuring, $10 million for currency effects and $50 million related to product liability. Sales should be about $3.9 billion, the company said.

Analysts had been expecting a 14 cents per-share loss, according to Thomson First Call.

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